RBI MPC Announcement: Guv Sanjay Malhotra Allows NPCI to Revise UPI Transaction Limits

Reserve Bank of India has announced that it will ask the National Payments Corporation (NPCI) to revise the Unified Payments Interface (UPI) transaction limit after consultation with banks and other stakeholders. The measures announced by the RBI governor Sanjay Malhotra in the first monetary policy committee (MPC) meeting of FY26 aims to boost fintech and payments system in the country. The raise will be for person-to-merchant (P2M) transactions, which is currently capped at Rs 1 lakh barring specific cases, according to a statement by the RBI. 

“To enable the ecosystem to respond efficiently to new use cases, it is proposed that NPCI, in consultation with banks and other stakeholders of the UPI ecosystem, may announce and revise such limits based on evolving user needs,” said the regulator.

The regulator mentioned that necessary safeguards will be put in place to avoid risks that might crop up due to higher transaction limits. 

In the statement, RBI noted that the transaction limits for Person to Person (P2P) transactions will continue to be capped at Rs 1 lakh.

This comes after NPCI increased the UPI transaction limit from Rs 50,000 to Rs 1-5 lakh in August last year in specific categories, including in case of payments to hospitals and educational institutions.

Apart from this, to align with the changing FinTech and regulatory landscape, the RBI has proposed to make the Regulatory Sandbox ‘Theme Neutral’ and ‘On Tap’. This comes after applications were invited for the ‘On Tap’ application facility in October 2021 and for the ‘Theme Neutral’ cohort in October 2023. The proposal by the regulator has come after considering feedback from various stakeholders. 

“Based on the experience gained and feedback received from stakeholders, it is now proposed to make the Regulatory Sandbox ‘Theme Neutral’ and ‘On Tap’,” said RBI.